letters and views Editor’s note: A recent discussion on the Cleaning & Maintenance Management Online Bulletin Board centered around what to charge for consumables at a new account. The conversation about offering a fair price to the customer while remaining profitable follows below. Posted by: TJ 1/16/2012 I’ve gotten some great advice on here, so here are a couple more questions. I just landed a new account, and the client wants me to give him a price on supplying consumables. What would be a fair markup? Also, what supplier has the best pricing? I am located in New Jersey. Thanks in advance. the BSCAI to get a discount on butt wipes; it may not washout in the end. A lot can happen with those things. If it starts working against you, you’ll be dissatisfied with the entire contract. Mike Kelley 1/17/2012 Hi Ken, I guess it depends what your volumes are. We’re a smaller company, so our monthly orders are not huge. But, with what we saved versus buying from local supply houses, we covered our BSCAI membership by the second order. The notion of being part of a larger buying group is pretty much how many industries around the world operate. As a smaller company, we don’t have access to the type of discounts that the big guys get when they purchase their “butt-wipes.” If we don’t get some sort of a pricing break, it’s hard to make money re-selling product. Using the Purchase Advantage Program definitely helps our margins. We also continue to use the local supply houses that provide quality service and good advice on products and equipment. TJ 1/18/2012 Thanks for the info. I was going to do around 15 percent to 20 percent markup. Do you charge monthly or as product is needed? Joseph Russell 1/18/2012 Add it as a second line to your monthly invoice. There is no sense in covering yourself up with paper or making your customer pro-cess more checks. CM Responses: Mike Kelley 1/17/2012 I don’t know what you spend on consum-ables, but the Building Service Contractors Association International (BSCAI) rolled out a purchasing program last year to its mem-bers that has worked really well for us both in terms of pricing and service. I suggest you go to the BSCAI website and check out the Purchase Advantage Program. Get involved To access the CM/Cleaning & Maintenance Management Online ™ bulletin board, go to www.cmmonline.com and click on the green bulletin board button near the top of the page. CM/Cleaning & Maintenance Management Online ™ viewers as well as CM/Cleaning & Maintenance Management ® magazine readers are encouraged to submit letters to the editor on topics of interest to the professional cleaning and maintenance industry. Send letters to the editor to [email protected]. Joseph Russell 1/17/2012 Ken Galo 1/17/2012 TJ, Markup average is 15 percent to 25 per-cent depending on volume. Double think paying membership dues to I would suggest that you get about 25 per-cent on all consumables. And, add to your order that prices will be reviewed every quarter or six months, just in case prices — especially paper — go through the roof again. www.cmmonline.com 5
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